Monetary Policy in Poland in the Conditions of Upheavals in Global Markets and the Change of Internal Business Cycle

The end of the nineties has brought many substantial changes on the world economic map. On the one hand, a considerable acceleration of globalization and integration process has taken place and the volume of transactions in financial markets increased enormously, whereas on the other hand, symptoms of financial crises become visible.

In the article, it is attempted to answer two basic questions: first. whether the financial perturbations of the late ‘nineties might result in monetary policy in Poland, and second, what has more contributed to the deterioration in the business situation in Poland in the late nineties, the above changes in world markets or the government policy of “cooling-down” domestic demand.

The analysis presented in the article shows that it was the continued policy of suppressing inflation using high interest rates which was the principal factor responsible for the worsening in business conditions. In conclusion, some proposals are suggested relative to instruments to be used in order to bring back and preserve the high rate of economic growth of Poland in years to come.